Forex Trading Sessions Explained
The currency pairs that are heavily traded during the Asia Pacific session are USD/JPY, EUR/JPY and AUD/JPY. The financial centers active during the Asia Pacific session are Wellington, Sydney, Tokyo, Hong Kong and Singapore. Currency trading volumes in the Asia Pacific session account for about 21% of the total daily global volume. Most of the transaction involves JPY as Japanese companies are trying to convert Japanese Yen into other currencies in order to do business with the rest of the world.
In terms of the most actively traded currency pairs during the Asia Pacific trading session that means news and data reports from Australia, New Zealand and Japan are going to be hitting the market during the session.
The Japanese financial centers are most active during this session so you can get a sense of what the Japanese market is doing based on price movements. Much of the action during this session is focused on the Japanese Yen currency pairs because of the size of the Japanese market and the importance of Japanese data to the market.
About midway through the Asian trading day, European financial centers begin to open up and the market gets to its full swing. European financial centers and London represent over 50% of the total global trading volume.
The European session overlaps with half of the Asian trading day and half of the North American trading day which means that the market interest and liquidity is at its peak during the European session.
London is the global forex center with the highest volume of foreign exchange transactions. As a result some of the biggest moves and the most active trading takes place in the European currencies (EUR, GBP and CHF) and the euro cross currency pairs (EUR/CHF and EUR/GBP).
Because of the overlap between the North American and European trading sessions, the trading volumes are much bigger. Some of the biggest and most meaningful directional price movements take place during this crossover period.
The most important financial markets in North America and US are located at New York and Chicago. The North American Session basically comprises New York and Chicago as financial centers. The North American trading session accounts for roughly the same share of the global trading volume as the Asia Pacific market, or about 22% of the daily global trading volume.
Nonfarm Payroll Figures are very important for those currency traders who heavily trade USD. Since USD is the global reserve currency that means almost all the currency traders give utmost attention to the US economic and political news. Most US data reports are released around 8:30 AM EST with others coming out later at around 9 AM and 10:00 AM EST. The North American morning is when US key economic data are released and the forex market makes many of its significant decisions on the value of USD.
However, there are some US economic reports that come out at noon or at 2:00 PM EST livening up the New York afternoon market. Canadian economic data reports are also released between 7 and 9 AM EST. Most of this news affects the CAD/USD pair. There are news traders who try to trade around these specific times and take benefit from the volatility caused in the markets by the release of this news.
London and European financial centers begin to wind down their daily trading operations around noon eastern time each day. The London or European close can bring volatile flurries of activity.
Market liquidity and interest falls off significantly in the New York afternoon on most trading days. This can make for challenging trading conditions. On quiet days, the generally lower market interest typically leads to stagnating price action. This is the best time for scalping as the market is moving sideways. - 23159
In terms of the most actively traded currency pairs during the Asia Pacific trading session that means news and data reports from Australia, New Zealand and Japan are going to be hitting the market during the session.
The Japanese financial centers are most active during this session so you can get a sense of what the Japanese market is doing based on price movements. Much of the action during this session is focused on the Japanese Yen currency pairs because of the size of the Japanese market and the importance of Japanese data to the market.
About midway through the Asian trading day, European financial centers begin to open up and the market gets to its full swing. European financial centers and London represent over 50% of the total global trading volume.
The European session overlaps with half of the Asian trading day and half of the North American trading day which means that the market interest and liquidity is at its peak during the European session.
London is the global forex center with the highest volume of foreign exchange transactions. As a result some of the biggest moves and the most active trading takes place in the European currencies (EUR, GBP and CHF) and the euro cross currency pairs (EUR/CHF and EUR/GBP).
Because of the overlap between the North American and European trading sessions, the trading volumes are much bigger. Some of the biggest and most meaningful directional price movements take place during this crossover period.
The most important financial markets in North America and US are located at New York and Chicago. The North American Session basically comprises New York and Chicago as financial centers. The North American trading session accounts for roughly the same share of the global trading volume as the Asia Pacific market, or about 22% of the daily global trading volume.
Nonfarm Payroll Figures are very important for those currency traders who heavily trade USD. Since USD is the global reserve currency that means almost all the currency traders give utmost attention to the US economic and political news. Most US data reports are released around 8:30 AM EST with others coming out later at around 9 AM and 10:00 AM EST. The North American morning is when US key economic data are released and the forex market makes many of its significant decisions on the value of USD.
However, there are some US economic reports that come out at noon or at 2:00 PM EST livening up the New York afternoon market. Canadian economic data reports are also released between 7 and 9 AM EST. Most of this news affects the CAD/USD pair. There are news traders who try to trade around these specific times and take benefit from the volatility caused in the markets by the release of this news.
London and European financial centers begin to wind down their daily trading operations around noon eastern time each day. The London or European close can bring volatile flurries of activity.
Market liquidity and interest falls off significantly in the New York afternoon on most trading days. This can make for challenging trading conditions. On quiet days, the generally lower market interest typically leads to stagnating price action. This is the best time for scalping as the market is moving sideways. - 23159
About the Author:
Mr. Ahmad Hassam has done Masters from Harvard University. He is interested in day trading stocks and currencies. Try These 1500 Pips A Day Forex Signals From Heaven. Know Forex Rebellion!
posted by X - Men @ 5:13 AM
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